FCA Financial Promotions: Section 21 Restriction (FSMA s21)
The Section 21 Restriction [FSMA s21]
Rule: A person must not communicate a financial promotion unless:
- They are an authorised person, OR
- The content is approved by an authorised person, OR
- An exemption applies
What counts as a financial promotion:
- Invitations or inducements to engage in investment activity
- Includes: ads, emails, social posts, website content, brochures
- Covers: investments, insurance, mortgages, consumer credit, crypto
Criminal offence: Breach is punishable by up to 2 years imprisonment and/or unlimited fine [FSMA s25]
Source Text
21(1) A person (“A”) must not, in the course of business, communicate an invitation or inducement to engage in investment activity or claims management activity.
(2) But subsection (1) does not apply if— (a) A is an authorised person; or (b) the content of the communication is approved for the purposes of this section by an authorised person…
(3) In the case of a communication originating outside the United Kingdom, subsection (1) applies only if the communication is capable of having an effect in the United Kingdom.
Definition of “investment” [s21(12)]:
“investment” includes any asset, right or interest (including where an asset, right or interest is, or comprises or represents, a cryptoasset)